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Fiscal and Economic Benefits of Belmont Park Redevelopment Civic

and Land Use Improvement Project, Town of Hempstead, NY

June 2019
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Multiplier Effects of Permanent Employment and Business
Contents Activity On-Site ................................................................................ 22
APPENDIX A: Summary of Fiscal Impacts ........................................ 28
Limitations ............................................................................................ 4
Executive Summary .............................................................................. 5
Fiscal Impacts from NYAP Expenditures ......................................... 6
Economic Impacts of the NYAP Project .......................................... 6 APPENDIX A: Summary of Fiscal Impacts
Economic Impacts of the LIRR Improvements ............................... 7
I. Report Scope .................................................................................... 8
Methodology and Assumptions ....................................................... 8
II. Project Description ........................................................................ 10
Overview.......................................................................................... 10
Significant Private Investment ...................................................... 10
Public-Private Investment in LIRR ................................................. 11
III. Assumptions ................................................................................. 12
Temporary Employment ................................................................. 12
Permanent Employment ................................................................ 12
Lease Agreement with ESD ........................................................... 13
IV. One-Time Construction Impacts .................................................. 14
Construction Budget as Basis for Measurement ......................... 14
Fiscal Impacts............................................................................. 14
Direct and Multiplier Effects of Project Construction .............. 14
V. Ongoing Impacts ........................................................................... 17
Permanent Employment as Basis for Measurement ................... 17
Fiscal Impacts............................................................................. 17

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Limitations
BJH Advisors, LLC (BJH) has prepared this report (the Report) for
Empire State Development (ESD) in conjunction with ESD’s
evaluation of a major commercial and civic development at
Belmont Park.

Unless otherwise stated in this Report, the assessments made


assume that the developed facilities will continue to be used for the
purpose and at the levels described by the proposed developer,
New York Arena Partners and/or one or more affiliates of NYAP
(NYAP), without significant change.

The conclusions contained in this Report are based upon


information provided through public data sources and by ESD and
NYAP, and upon the assumption that all relevant information has
been provided by those parties from whom it has been requested.
NYAP has made no representations and warranties with respect to
such information and has no obligation to update assumptions or
information provided for this Report. Estimated project
performance is based on projections provided by NYAP and actual
results may vary. Information obtained from third parties has not
been independently verified by BJH, unless otherwise stated in the
Report.

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Executive Summary in a structure beneath Retail Village (with the total SF of the
Experiential Retail and Retail Village limited to a maximum
In 2017, Empire State Development (ESD) undertook a public of 350,000 SF);
procurement process for the development of underutilized parcels • Approximately 3.75 acres of passive open space on Site B
at Belmont Park (Project Site). The Project Site represents including an 8-foot-high landscaped berm on Site B with
approximately 43 acres of land or approximately 10 percent of the dense evergreen tree landscaping on top of the berm to
buffer Site B from the adjacent residential neighborhood;
total Belmont Park property. The Project Site is divided into a Site A
and a Site B portion, as shown in the site plan on page 10 below. • Grade-separated connections for pedestrians and vehicles
above or below Hempstead Turnpike, providing access
On December 21, 2017, ESD’s Directors conditionally designated, between Site A and Site B.
subject to all public approval processes as required by law, New
In addition, to improve public transit service and encourage transit
York Arena Partners as the developer of a project, which will consist
ridership to the Project Site, NYAP and the Long Island Railroad
of several key components:
(LIRR) have collectively committed to fund LIRR service upgrades,
• An up to 19,000 seat arena (Arena) on Site A, totaling totaling $104 million (collectively, the LIRR Improvements). These
approximately 745,000 gross square feet (SF) with upgrades include switch and signal equipment upgrades at the
approximately 40 parking spaces, for entertainment, existing Belmont Park Station and the construction of a new full-
recreational, cultural and community uses, including use as time Elmont Station located on the Main Line/Hempstead Branch.
the home arena for the New York Islanders (Islanders), a NYAP’s payments to fund these improvements total $30 million.
National Hockey League (NHL) franchise and other event
space;
This Report presents estimates of the economic and fiscal benefits
• Experiential retail, dining and retail uses on Site A
of the Belmont Park Redevelopment Civic and Land Use
(Experiential Retail) totaling up to 35,000 SF;
Improvement Project (the Project) to the Elmont Union Free School
• Hotel facility (Hotel) on Site A of up to 210,000 SF with up
District and Sewanhaka Central High School District (Schools), the
to 250 keys, 400 structured parking spaces, and amenities
and dining, conference and event space; Elmont Fire District, the Town of Hempstead, Nassau County, the
Metropolitan Transportation Authority (MTA), and New York State.
• Commercial office space (Office) on Site A of 30,000 SF;
This Report also presents estimates of the economic benefits of the
• Landscaped plazas on Site A totaling approximately 2.0
LIRR Improvements.
acres;
• Community facility (Community Facility) space component of The Arena will be the new home of the New York Islanders and will
10,000 SF on the Project Site offering educational and host other entertainment, cultural and community events
career development services; throughout the year. All components of the Project are expected to
• Destination retail (Retail Village) on Site B of up to 315,000 open in 2021. The improvements to the existing LIRR Belmont
SF with up to approximately 1,500 parking spaces located

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Park Station are also anticipated to be complete in 2021 at the the PILOT stream is estimated to be $272 million over 49
time of Project opening, while the new full-time LIRR Elmont Station years, with approximately $154 million going to the Schools,
is anticipated to be partially open for service in 2021 at the time of approximately $15 million to the Elmont Fire District, and
the remainder or $103 million going to Nassau County and
Project opening and fully placed-in-service in 2023. For purposes
Town of Hempstead through an agreement between the
of measuring the permanent fiscal and economic impacts, full State and the County.
operations and associated sales activities were assumed to begin
in 2024. Below is a summary of the Report findings.
Economic Impacts of the NYAP Project
Fiscal Impacts from NYAP Expenditures
Economic impacts are defined as spending in the economy,
The fiscal benefit estimates are based on the one-time construction employment, and wages from the Project’s temporary / one-time
spending, and on-going employment and spending activities at the and permanent / ongoing activity. Below is a summary of both one-
Project Site that provide tax revenues to the several state and local time and on-going impacts.
taxing jurisdictions. A summary of those impacts follows (and a
One-Time Economic Impacts from Construction - Direct
breakdown is provided in Appendix A):
• $1.26 billion in direct construction spending, of which $994
million is hard costs. The direct construction spending also
• Total of $50 million provided to ESD by NYAP including i)
includes $30 million for LIRR station and track
$30 million between 2019 and 2021 to be applied to the
improvements; and an additional $20 million in Project
LIRR Improvements; and ii) in 2020, $20 million for Project
infrastructure improvements
Site infrastructure;
• 6,366 in temporary jobs2
• Approximately $67 million in additional payments, • $497 million in direct earnings
comprised of annual payments made by NYAP of
approximately $2.2 million over 30 years;
One-Time Construction Impacts – Total, including Multiplier
• Approximately $44 million in annual tax revenues, other • 9,240 in temporary jobs, of which 6,366 are direct
than PILOT, (2024 estimate which escalates), to Nassau construction and 2,874 are additional “spillover”3 jobs
County, the Town of Hempstead, the State and the MTA
from ongoing activities at the Project Site;
• Approximately $6 million in annual PILOT revenues (2024
estimate which escalates); the net present value1 (NPV) of

takes into account a municipal rate of borrowing as well as more macro-


economic factors such as monetary supply and future borrowing rates.

1BJH discounted the PILOT stream at 6.25%. This is the discount rate 2For construction impacts, a “job” refers to one “person-year” of
used by New York City for present value calculations of taxes over time. It employment, or the employment of one person for one year.

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• $1.88 billion in total economic output One-Time Construction Impacts – Total, including Multiplier
• $654 million in total earnings • $155 million in total economic output including direct,
indirect and induced expenditure
On-Going Economic Impacts from Operations - Direct • 754 in temporary jobs, of which 520 are direct construction
• 2,455 in direct employees, of which 618 are Arena related jobs and 235 are additional “spillover” jobs
employees and 1,148 are associated with the Retail Village; • $53.4 million in total earnings
the remaining 689 employees will be associated with the
Hotel, Experiential Retail, Office and Community Facility
• $487 million in direct output annually from Project
operations, including the Arena, Retail Village, Hotel,
Experiential Retail, Office and Community Facility
• $94 million in total earnings annually related to direct
employees

Ongoing – Total, including Multiplier


• 3,179 in total permanent employees, of which 2,455 are
direct and 724 are spillover jobs
• $725 million in total economic output annually
• $133 million in total annual earnings from both direct and
spillover employment

Economic Impacts of the LIRR Improvements


One-Time Economic Impacts from Construction - Direct
• $104 million in direct construction spending, of which 78
percent or $81 million is estimated to be hard costs
• 520 in temporary jobs or worker years
• $40.6 million in direct earnings

3“Spillover” refers to effects that are “other than direct,” meaning


business-to-business or employee spending.

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I. Report Scope fiscal impacts of these employees on Elmont Union Free School
District and Sewanhaka Central High School District, Elmont Fire
This Report estimates economic and fiscal beneficial impacts of a District, Nassau County, Town of Hempstead, MTA, and State
new civil and commercial mixed-use project (the Project) to be revenues (e.g. income and sales taxes). In addition, these
developed at Belmont Park by NYAP. The Project is comprised of a employment and earnings estimates are used as the basis for
new multi-purpose arena; retail, dining & entertainment uses; a determining the multiplier effects of the onsite activity on the
hotel; an office component; and a community facility component. Nassau County economy, worker earnings and total regional
The Project will also include landscaping, and connections between employment.
site areas, and requires public improvements, including offsite
enhancements to Elmont Road Park and Hendrickson Avenue Park, Methodology and Assumptions
public parks located in the Town of Hempstead; upgrades to MTA
Where available, the Report relies on information provided by NYAP
and Long Island Railroad (LIRR) switching and signal equipment at
related to the Project spending, revenues and employment, as well
the existing Belmont Park Station; dedicated LIRR service to the
as expenditure breakdown provided by the Metropolitan Transit
Project Site for Arena events; and the construction of a new full-
Authority for the LIRR Improvements. Where necessary, the Report
time LIRR Main Line Elmont station.
analysis makes assumptions and uses other data sources to
The Report seeks to provide the following analysis: determine information and required inputs needed to calculate the
fiscal and economic impacts of the Project. Examples of the type of
Task 1: Fiscal and Econom ic Benefits for the information used as inputs to the analysis include workers’ wages,
Construction Phase of Project. Included in the Report’s employee place of residence, tax filing status and employee taxable
estimates are the negotiated investments and payments that NYAP expenditures. Wherever possible, the Report uses published
is required to make at the Site in conjunction with the Project, and guidelines and public data sources in determining Project
an estimate of temporary construction employment and multiplier assumptions (e.g. U.S. Bureau of Economic Analysis and the U.S.
effects of the construction “event” on the Nassau County4 economy, Department of Labor Bureau of Labor Statistics Consumer
including both worker earnings and total regional employment. Expenditure Survey). The Report also relies on current tax and fee
rates to estimate potential School District, Fire District, County,
Task 2: Fiscal and Econom ic Benefits for Ongoing
Town, State, and MTA revenues generated by the construction and
Operations at the Project Site. Included in the Report’s
ongoing operations on-site.
estimates are permanent ongoing employment at the Site and the
M ultiplier Effects. Both during construction and on an ongoing
basis, the Project will generate broad-based effects on the regional
and State economies. When an entity invests in capital projects or
4 operations, it creates spin-off effects from payments to suppliers
State impacts are not measured in this Report.

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and consumer spending. These impacts, known as “economic estimates of tax revenues are based on current tax policy, as of
multiplier effects,” measure the increased demand of temporary June 2019.
and permanent employment and associated spending on total
output (other business spending), earnings (individual earnings and The fiscal estimates provided are total revenues, without netting
income), and employment (total number of jobs) generated by the out the cost of additional services that may be required to support
ongoing activity at the Project Site. new economic activity in the local area (e.g. police, fire, water,
sewer infrastructure). In addition, the ongoing economic impact
To estimate these multiplier effects on the local economy, this estimates do not consider assumptions related to whether the
Report uses the RIMS II multipliers and the construction budget and spending and jobs are moving from one site presently in New York
operating headcount, which act as proxies for direct construction State to the new project location. In other words, all of the
and operating impacts respectively. employment and activity is assumed to be “net new” economic
activity to the State, which is a reasonable assumption given the
RIMS II multipliers, developed by the Bureau of Economic Analysis type and unique nature of the retail uses and the newly generated
(BEA) of the U.S. Department of Commerce, estimate the impact on demand for hotel and accommodation services generated by the
a region’s economy from an initial change in sales, income or jobs other program components.
created by an event or a project.
Due to the unknown characteristics of the retail tenants’ corporate
For a given region, input-output models can estimate three types of ownership, no Town, County, or New York State tax impacts
multiplier effects: associated with corporate revenues have been estimated, which is
a conservative estimation.
i. Direct – the number of jobs, output and/or earnings
required to complete the construction project or provided
by the operating entity.
ii. Indirect – multiplier effect jobs, output and/or earnings
related to business-to-business expenditures or created
because of increased input demand.
iii. Induced – multiplier effect jobs, output and/or earnings
related to consumer spending or created by direct or
indirect workers spending their household incomes in the
local economy.

Although the Project is expected to open in 2021, the budgets,


including construction budgets, have not been inflated. As a result,
estimates in this Report are made in 2019 dollars. Furthermore, all

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II. Project Description Site Plan for NYAP Development at Belmont Park

Overview
NYAP proposes to create a vibrant new mixed-use commercial
development at Belmont Park in the Town of Hempstead, Nassau
County, New York. Construction is expected to begin in 2019, and
the Project is to be placed-in-service in 2021. Once completed, the
Project is anticipated to offer approximately 745,000 SF of Arena
uses, 350,000 SF for Experiential Retail and the Retail Village,
210,000 SF of Hotel uses, 30,000 SF of Office uses, and 10,000
SF of Community Facility uses. The site plan below provides an
overview of the Project components and their locations.

Significant Private Investment


Total Project costs are estimated to be approximately $1.26 billion,
with hard costs of approximately $994 million and soft and
financing costs of approximately $265 million. This amount
includes payments made by NYAP of $30 million for LIRR upgrades
and improvements and $20 million for on-site infrastructure work.
The breakdown of square footage by use, as well as cost by use,
including costs associated with 2 acres of landscaped area on Site
A, 3.75 acres of passive open space on Site B, parking and Project
Site connections are included in Table 1 below.

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Table 1 Program and Costs
Project Costs
Industry Sector Total SF $MM
Arena 745,000 $ 859
Hotel 210,000 $ 253
Retail 315,000 $ 147
Dining & Entertainment 35,000 (a)
Community Space 10,000 (a)
Office 30,000 (a)
Total $ 1,259
Source: Based on Project budget information provided by NYAP.
a) Cost included in Arena budget.

Public-Private Investment in LIRR


In addition to the significant private investment at the Site, there
will be an associated public-private investment in improving LIRR
service to the Site. This public-private investment will fund
upgrades to the switching and signal equipment at the existing LIRR
Belmont Park Station as well as the construction of a new full-time
LIRR Elmont Station that will be located on the Main
Line/Hempstead Branch significantly increasing public transit
access to the Site. This new full-time station will be partially open
for service for eastbound customers (going from Manhattan to Long
Island) in 2021 and will be fully open for both east and westbound
customers in 2023. The total investment in the LIRR Improvements
is anticipated to be $104 million, of which $30 million is to be
funded by NYAP and $74 million is to be funded by the State of New
York.

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Project Site, except for the Retail on located on Site B where
III. Assumptions double shifts daily are assumed. The total direct employment
estimate from new uses through the Project, using the SF per
Temporary Employment worker guidelines detailed above, is 2,455, and is broken down
by industry sector as shown in Table 2 below.
The Report estimates temporary construction employment –
which is measured in “person-years” and is equal to the
employment of one person for one year – by dividing the labor Table 2 Permanent Employment, Wages
costs of the Project (50 percent of both building and
infrastructure hard costs) by the cost of a worker on site per year Industry Sector SF/Employee Employees Wages ($) (b)
or approximately $78,062. This annual labor cost was derived Arena (a) 1,124 618 $ 47,650
from a weighted average of the wage of one construction Hotel 1,124 205 $ 34,691
manager to the wages of five other construction workers, a Retail (c) 549 1,148 $ 33,670
reasonable ratio of the types and levels or workers expected to Dining & Entertainment 100 328 $ 37,062
contribute to the Project’s physical development. The total Community Space 405 25 $ 43,310
number of estimated employees for the Project is 9,240 worker Office 228 132 $ 43,310
years. Total (d) 2,455
Source: Based on Project budget information provided by NYAP.
Permanent Employment a) 30,000 SF removed from Arena SF for purposes of employee calculation.
b) For purposes of the fiscal and economic impacts analysis, wages are derived from
Once complete in 2021, the Project will offer the region new
the U.S. Bureau of Labor Statistics survey data for Nassau County. NYAP projects
entertainment, dining, retail, event space, office, community
facility, open space and recreational facilities. The projected higher wages in several categories, which would serve to increase impacts.

average space utilization for arena and hotel worker is 1,124 SF; c) Assumes two shift of work for every brand.

for full-service dining is 134 SF; for limited service dining is 100 d) May not add due to rounding.

SF; for destination retail (Retail Village) is 549 SF; for community
space is 405 SF; and for office space is 228 SF. Approximately In order to make estimates of tax revenues generated by these
8,750 SF of the experiential dining and retail on Site A is employees, including income and sales tax revenue estimates,
expected to be full-service, and approximately 26,250 SF is the Report assumes the wage averages for each employment
expected to be limited service. It should be noted that if the category, also shown in Table 2 (above). These averages are
experiential dining and entertainment space operates two shifts based on information from the U.S. Bureau of Labor (BLS)
of workers, the employment numbers in this category would Statistics Occupational Employment Statistics, May 2017 for
double. The Report assumes single shifts for business at the Nassau County-Suffolk County and from NYAP.

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Lease Agreement with ESD
NYAP will ground lease the Project Site from ESD in order to
effectuate the development. In calculating fiscal impacts, the
Report includes the new infrastructure investments associated
with the Project made by NYAP, as well as annual payments,
which NYAP will pay to ESD over a 30-year schedule.

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IV. One-Time Construction Impacts Fiscal Impacts

Construction Budget as Basis for Of NYAP’s total $1.26 billion investment, $50 million will be spent
on public infrastructure: $30 million on the LIRR Improvements
Measurement
and $20 million on site improvements. This expenditure accrues
NYAP’s total construction budget of $1.26 billion will be spent to the benefit of public goods available to all.5
over the course of an approximately 28-month construction
period, generating employment and earnings in the Town of
Direct and Multiplier Effects of Project
Hempstead, Nassau County and the State. Of the $994 million in Construction
hard costs, half or $497 million are anticipated to go to labor
The construction expenditure, earnings and employment will
earnings. The construction spending will generate significant
generate multiplier effects in the New York State economy. Those
direct and spillover fiscal and economic impacts, outlined below
impacts are shown in Table 3 and Table 4 below, which indicate
in greater detail, for Nassau County.
that $1.88 billion in total output, $654 million in total earnings
Expenditure of $104 million for the LIRR Improvements will be and 9,240 jobs in total employment will result from construction
undertaken over the course of a 24-month construction period of the Project and an additional $155 million in total output,
beginning in 2021 with an anticipated partial completion in 2021 $53.4 million in total earnings and 754 jobs in total employment
for eastbound customers and a full completion for both east and will result from the LIRR Improvements.
westbound customers in 2023. The LIRR Improvements
As explained above in Section III, the analysis assumes an
investment will generate employment and earnings in Nassau
average construction wage annually of $78,062. This is well
County and the State. Of the $104 million in total costs, 78% or
above the annual average income for Nassau and Suffolk County
$81 million is anticipated to be in hard costs, and half of the hard
of $62,870. Furthermore, NYAP has committed to hiring
costs, or $40.6 million, are anticipated to be labor earnings.
contractors that provide both training and benefits, in the form of
There will be significant economic spillover effects (both business
healthcare insurance, paid time-off, and retirement savings, to
to business and worker to business) from this expenditure.

5 Other fiscal impacts that typically occur at project financing will be


waived in the case of the Project, Per the proposed General Project Plan
(GPP) and proposed lease agreement negotiated between ESD and the
NYAP, the initial construction expenditures will be exempt from sales tax,
and the NYAP will be able to benefit from a mortgage recording tax
waiver for any construction financing related mortgages.

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construction trade workers at the site. The construction labor
used for the Project is also subject to Minority- or Women-Owned
Business Enterprise (MWBE) and Service-Disabled Veteran
Owned Small Business (SDVOB) hiring goals by percent of total
construction spending.6

6NYAP has committed to a 30 percent MWBE contracting goal and a 6


percent SDVOB contracting goal for the construction of the Project.

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Table 3 Construction (Temporary)
Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $1,259,350,000 $252,877,480 $368,485,810 $1,880,713,290
Earnings $496,945,000 $57,496,537 $99,488,389 $653,929,926
Employment 6,366 851 2,023 9,240

Table 4 Construction (Temporary) - LIRR Improvements


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $104,000,000 $20,883,200 $30,430,400 $155,313,600
Earnings $40,560,000 $4,692,792 $8,120,112 $53,372,904
Employment 520 69 165 754

Sources: RIMS, 2016 Multipliers, BJH 2019


Notes:
a) Does not include soft costs, escalation, or entitlement pursuit costs that are accounted for in the multiplier effects.
b) Assumes labor accounts for 50% of costs. Labor costs, including benefits, during one worker year is assumed to be 1.5*annual wages or $78,062.

c) Estimate provides number of person-years during construction period for both Project construction and FF&E labor.

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V. Ongoing Impacts In addition to income taxes, New York State would benefit from
revenue impacts associated with the Metropolitan Commuter
Permanent Employment as Basis for Transportation Mobility Tax (MCTMT), a tax imposed on employers
Measurement who have workers at New York State locations, such as the
Project Site. The tax is imposed on all persons employed in New
Permanent direct employment at the Project Site is estimated to York State whether the employee lives in New York State or not.
be a total of 2,455 jobs (per the methodology outlined on page
12), comprised of 618 Arena jobs, 205 Hotel jobs, 1,148 Retail Sales Tax on W orker Expenditures: Workers at the Project
Village jobs, 328 Experiential Retail jobs, 25 Community Facility Site who live in New York State are expected to make
jobs, and 132 Office jobs. These permanent jobs are the basis of expenditures that are subject to New York State sales tax. The
estimating the significant ongoing economic and fiscal impacts of sales tax rate for purchases made in Nassau County is 8.625%,
the Project for Nassau County, as described in further detail which includes 4.25% for the County portion, 4.0% for the State
below. portion, and 0.375% as a surcharge accruing to the MTA.

In order to calculate the portion of workers’ salaries that would be


Fiscal Impacts
subject to New York State sales tax, as well as the MTA portion of
Income Tax and Metropolitan Commuter Transportation the sales tax, the analysis in this Report uses the U.S.
M obility Tax on Em ployee W ages: The permanent workers Department of Labor 2018 BLS Consumer Expenditure Survey for
employed at the Project site will earn wages and pay taxes, some total households to determine spending patterns for tax
of which will be captured by New York State. Of the total on-site applicable categories.
employees, 100% are assumed to be New York State residents
Table 5 below estimates the New York State income tax and the
and therefore required to pay New York State income taxes. For
MCTMT associated with Project employment, and Table 6
the purposes of this Report, the total aggregate salaries per
provides an estimate of County, New York State and MTA sales
worker category are estimated to be within a 5% range of the
tax revenues generated by employee spending as a result of the
aggregate average worker wage reported by the U.S. BLS
Project.
Occupational Employment Statistics, May 2017 for Nassau
County-Suffolk County for the industry sector in which the worker
is employed, except for married filers in employed in the Retail
Village and single filers in the Community Space, where slightly
higher wages (up to 35 percent variance from BLS data) were
assumed.

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Table 5 Income and Metropolitan Commuter Transportation Mobility Tax Revenues
(in 2019 $s) Annual
Total NYS Average Total NYS Income MCTMT
On-Site Employment Jobs (a) Jobs (b) Salary Payroll Tax Revenues Revenues (c)
Arena
Married Filers 40% 247 247 $ 48,446 $ 11,966,100 $ 618,365 $ 40,685
Single Files 60% 371 371 $ 49,277 $ 18,281,836 $ 1,059,166 $ 62,158
Hotel
Married Filers 40% 81 81 $ 36,327 $ 2,942,515 $ 139,873 $ 10,005
Single Files 60% 124 124 $ 35,476 $ 4,399,010 $ 242,292 $ 14,957
Retail
Married Filers 40% 455 455 $ 42,033 $ 19,124,878 $ 955,365 $ 65,025
Single Files 60% 693 693 $ 34,997 $ 24,235,626 $ 1,338,745 $ 82,401
Dining & Entertainment
Married Filers 41% 134 134 $ 37,115 $ 4,973,466 $ 237,764 $ 16,910
Single Files 59% 194 194 $ 38,958 $ 7,557,768 $ 423,315 $ 25,696
Community Space
Married Filers 41% 10 10 $ 44,315 $ 443,154 $ 22,068 $ 1,507
Single Files 59% 15 15 $ 56,092 $ 813,332 $ 47,612 $ 2,765
Office
Married Filers 41% 54 54 $ 45,609 $ 2,462,869 $ 123,906 $ 8,374
Single Files 59% 78 78 $ 45,231 $ 3,528,000 $ 201,272 $ 11,995

Totals 2,455 2,455 $ 41,030 $ 100,728,551 $ 5,409,742 $ 342,477


Sources: NYS Occupational Employment Statistics Survey, updated to Q1 2017; NYS Tax Rates; BJH, 2019
Notes:
a) Approximately 40% allocated to married and 60% allocated to single filing status
b) Percent of employees living in NYS = 100%
c) MCTMT tax rate = 0.34% (Employers with payroll over $437,500, assumed to be all of the above)

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Table 6 Employee Associated Sales Tax Revenues
(in 2019 $s)

Annual Taxable Expenditure Employees Average State Tax County Tax MTA Tax Total Tax
By Employment Source (NYS only) Taxable Exp. (a) Revenue (b) Revenue (c) Revenue (d) Revenues
Arena 618 $15,326,172 $ 613,047 $ 651,362 $ 57,473 $ 1,321,882
Hotel 205 $ 5,071,971 $ 202,879 $ 215,559 $ 19,020 $ 437,457
Retail 1,148 $28,443,525 $ 1,137,741 $ 1,208,850 $ 106,663 $ 2,453,254
Dining & Entertainment 328 $ 8,124,978 $ 324,999 $ 345,312 $ 30,469 $ 700,779
Community Space 25 $ 612,012 $ 24,480 $ 26,011 $ 2,295 $ 52,786
Office 132 $ 3,261,382 $ 130,455 $ 138,609 $ 12,230 $ 281,294
Total 2,455 $60,840,039 $ 2,433,602 $ 2,585,702 $ 228,150 $ 5,247,453
Sources: US Department of Labor, BLS Consumer Expenditure Survey; BJH, 2019
Notes:
a) Based on Selected Expenditures for Total Wage and Salary Earners (2016-7, NYC MSA, BLS Consumer Expenditure Survey)
Food away from home $ 4,285
Alcoholic beverages $ 499
Utilities, Fuels, and Public Services $ 4,000
Housekeeping Supplies $ 661
Household furnishings & equipment $ 1,582
Apparel and services (@50%) $ 1,146
Transportation $ 7,907
Entertainment $ 2,672
Personal Care Products & Services $ 791
Tobacco products $ 245
Misc. Expenditures $ 999
Total $ 24,787
b) New York State sales tax rate = 4.0%
c) County sales tax rate = 4.25%
d) MTA sales tax rate = 0.375%

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Sales and Adm issions Taxes Generated by Gross
Receipts from Site Activities: NYAP estimates that both the
Experiential Retail (Retail A for food, retail and entertainment)
and related operations and the Retail Village (Retail B) collectively
would produce approximately $329 million in annual gross sales.
Of the Site B or Retail B sales, approximately 45 percent are
expected to be for clothing and footwear items over $110 and
therefore subject to State sales tax.

Arena F&B and merchandise sales are estimated to be


approximately $47 million annually. Hotel F&B sales are
estimated to be over $4 million annually. Admission based ticket
revenues and taxes are estimated based on a projected 2.4
million annual guests.

Based on these assumptions, on site sales and admissions taxes


are estimated to be approximately $30 million annually for the
County, State and the MTA collectively, as per Table 7 below.

Other Paym ents Associated with the Ground Lease:


NYAP will make an annual payment made by NYAP of
approximately $2.2 million for 30 years, totaling approximately
$67 million. This annual payment is in addition to $50 million
that NYAP will pay between 2019 and 2021 for LIRR and on-site
infrastructure resulting in a total NYAP payment of $117 million
for the Project and the State of New York.

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Table 7 On-Site Sales and Admissions Tax Revenues
(in 2019 $s)

Sales Tax Annual State Tax County Tax MTA Tax Total Tax
Category Sales or Attendance Net Sales Revenue (e) Revenue (f) Revenue (g) Revenues
Arena F&B (a) $ 40,129,000 $18,820,501 $ 1,605,160 $ 1,705,483 $ 150,484 $ 3,461,126
Arena Merchandise (b) $ 6,441,000 $ 1,288,200 $ 257,640 $ 273,743 $ 24,154 $ 555,536
Retail A $ 26,208,255 N/A $ 1,048,330 $ 1,113,851 $ 98,281 $ 2,260,462
Retail B (c) $ 302,786,632 N/A $ 5,450,159 $12,868,432 $ 1,135,450 $ 19,454,041
Hotel F&B $ 4,237,010 N/A $ 169,480 $ 180,073 $ 15,889 $ 365,442
Arena Attendance / Tax (d) 2,378,844 N/A N/A $ 3,568,266 N/A $ 3,568,266
Total $ 379,801,897 $20,108,701 $ 8,530,770 $19,709,847 $ 1,424,257 $ 29,664,874
Sources: 2024 sales data from NYAP; Rates from NYS DOF Tax Rates; BJH, 2019
Notes:
a) Arena F&B net percentage = 46.9%
b) Arena merchandise net percentage = 20.0%
c) Percentage of clothing and footwear over $110, and therefore subject to State rate 45.0%
d) Admissions tax per head = $ 1.50
e) New York State sales tax rate = 4.0%
f) County sales tax rate = 4.25%
g) MTA sales tax rate = 0.375%

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Paym ent-in-Lieu-of-Taxes (PILOT): NYAP will pay PILOT for room rate of $234, total Hotel taxes are estimated to be
each of the key components of the development. For the Arena, approximately $927,000 annually
PILOT will be a per event a fee of $10,000 per full event or
$5,000 per half-event, defined as an event limited to 5,000 or Table 8 Nassau County Hotel Taxes
fewer attendees; NYAP guarantees a minimum annual PILOT (in 2019 $s)

payment of $1,000,000 with annual escalation for the Arena. For


Number of Keys 250
the Hotel, PILOT will be an amount equivalent to the actual real
estate taxes subject to a twenty-year abatement period on the Hotel Occupancy Tax
improvements phased in on a straight-line basis with fixed per
Per Night Total $ 1,088
annum rate increases to reach full tax equivalency and subject to
Total for Year (a), (b), (c) $ 397,157
subsequent assessments and special assessments. For the
Retail Village, PILOT will be an amount equivalent to the actual State Sales Tax on Rooms (d)
real estate taxes subject to a fifteen-year abatement period on Per Night Total $ 1,451
the improvements phased in on a straight-line basis with fixed per Total for Year (e) $ 529,542
annum rate increases to reach full tax equivalency and subject to
subsequent assessments and special assessments. Finally, in Total for Year $ 926,699
the case of any other project component, an amount equivalent Sources: Nassau County Department of Taxation and Finance; BJH 2019
to the actual real estate taxes subject to a ten-year abatement Notes:
period on the improvements phased in on a straight-line basis a) Nassau County Hotel tax rate 3.0%
with fixed per annum rate increases to reach full tax equivalency b) Average Room Rate $ 234
and subject to subsequent assessments and special c) Occupancy Rate 62%
assessments. d) Does not include F&B 4.0%
e) State Sales Tax Rate 4.0%
Overall, it is expected that PILOT will have a net present value
(NPV) of $272 million over 49 years, with approximately $154
million going to the Schools, approximately $15 million to the
Elmont Fire District, and the remainder or approximately $103
Multiplier Effects of Permanent Employment
million going to Nassau County. and Business Activity On-Site

Hotel Taxes: The Hotel activity will generate County hotel Permanent workers at the Project Site will be employed for the
occupancy taxes and State sales taxes. Based on 250 rooms at following uses: Arena/Entertainment, Hotel, Retail Village,
an average annual 62 percent occupancy and an average daily Experiential Retail (dining, retail and entertainment), Office, and
Community Facility. This Report uses RIMS II multipliers to

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determine effects from the on-site employment on total economic
output, total earnings and total employment. Tables 9 through 21
show the economic activity from various uses at the Project Site.

A series of final tables then follows: Table 22 shows a recap of


the temporary impacts, both NYAP and LIRR Construction; Table
23 shows the summation of the impacts of the permanent site
activities; and Table 24 shows the aggregate economic activity
from both the temporary construction and the initial year of
permanent activities at full operation of the Project. This
aggregate of temporary and permanent economic activity is
estimated at $2.6 billion in total output, including the original
change in demand, $786 million in total annual earnings, and
12,419 in total direct and indirect employment.

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Table 9 Arena - Spectator Sports (Local)
Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $26,545,721 $5,606,456 $0 $32,152,178
Earnings $7,966,064 $1,037,182 $0 $9,003,246
Employment 167 24 0 192

Table 10 Arena - Spectator Sports (Non-Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $6,636,430 $1,401,614 $3,011,612 $11,049,657
Earnings $1,991,516 $259,295 $403,879 $2,654,691
Employment 42 6 13 61

Table 11 Arena - Performing Arts Companies (Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $38,999,944 $18,700,473 $0 $57,700,417
Earnings $11,703,432 $4,261,220 $0 $15,964,652
Employment 246 38 0 284

Table 12 Arena - Performing Arts Companies (Non-Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $25,999,962 $12,466,982 $8,150,988 $46,617,933
Earnings $7,802,288 $2,840,813 $1,910,000 $12,553,101
Employment 164 26 19 208

Table 13 Retail - Other Retail (Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $84,599,292 $28,586,101 $0 $113,185,392
Earnings $11,591,311 $3,233,976 $0 $14,825,287
Employment 344 64 0 408

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Table 14 Retail - Other Retail (Non-Local)
Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $197,398,347 $66,700,902 $47,908,579 $312,007,828
Earnings $27,046,393 $7,545,944 $6,207,147 $40,799,485
Employment 803 149 141 1,093

Table 15 Dining - Limited-Service - (Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $30,589,574 $9,602,067 $0 $40,191,642
Earnings $4,864,344 $1,287,592 $0 $6,151,936
Employment 131 14 0 145

Table 16 Dining - Limited-Service - (Non-Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $7,647,394 $2,400,517 $1,767,313 $11,815,223
Earnings $4,864,344 $1,287,592 $1,104,206 $7,256,142
Employment 131 14 14 159

Table 17 Dining - Full-Service - (Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $22,942,181 $7,442,443 $0 $30,384,624
Earnings $1,210,036 $268,265 $0 $1,478,301
Employment 33 3 0 36

Table 18 Dining - Full-Service - (Non-Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $15,294,787 $4,961,629 $4,282,540 $24,538,957
Earnings $1,210,036 $268,265 $265,361 $1,743,662
Employment 33 3 4 41

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Table 19 Hotel - Accommodation (Non-Local)
Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $22,705,293 $6,532,313 $5,022,411 $34,260,016
Earnings $7,098,674 $2,046,548 $1,641,923 $10,787,144
Employment 205 40 40 285

Table 20 Innovation Space - Scientific research and development services (Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $1,283,259 $556,421 $0 $1,839,680
Earnings $1,069,383 $489,670 $0 $1,559,053
Employment 25 18 0 43

Table 21 Office - Management of Companies and Enterprises (Local)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $6,838,421 $2,236,164 $0 $9,074,585
Earnings $5,698,684 $2,030,441 $0 $7,729,125
Employment 132 94 0 225

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Table 22 One-Time Impacts: NYAP and LIRR Construction
Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $1,363,350,000 $273,760,680 $398,916,210 $2,036,026,890
Earnings $537,505,000 $62,189,329 $107,608,501 $707,302,830
Employment 6,886 921 2,188 9,995

Table 23 Development (Ongoing)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $487,480,606 $167,194,082 $70,143,443 $724,818,131
Earnings $94,116,505 $26,856,802 $11,532,517 $132,505,824
Employment 2,455 493 232 3,179

Table 24 Project Total (Ongoing and Temporary)


Impacts Direct Effects Indirect Effects Induced Effects Total (Direct + Multiplier)
Net Output $1,746,830,606 $420,071,562 $438,629,253 $2,605,531,421
Earnings $591,061,505 $84,353,339 $111,020,906 $786,435,750
Employment 8,821 1,344 2,255 12,419

Notes:

a) Output derived using multiplier analysis.


b) Indirect and induced impacts estimated for Nassau County.

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APPENDIX A: Summary of Fiscal Impacts

Summary Table Fiscal Impacts


(in 2019 $s)

Type of Revenue
One-Time
Site Infrastructure Payment $ 20,000,000
LIRR Improvements Payment $ 30,000,000
Total $ 50,000,000

Re-Occurring, Annual (a) (b)


Annual ground rent to State (ESD) $ 2,236,595
State Income Tax On Employees $ 5,409,742
Metropolitan Commuter Transportation Mobility Tax $ 342,477
Sales Tax Employees (State) $ 2,433,602
Sales Tax Employees (County) $ 2,585,702
Sales Tax Employees (MTA) $ 228,150
Sales Tax Site (State) $ 8,530,770
Sales Tax Site (County) $ 16,141,581
Sales Tax Site (MTA) $ 1,424,257
Admissions Tax (County) - On-Site Sales $ 3,568,266
Nassau County Hotel Tax $ 926,699
Total $ 43,827,840
Notes:
a) Stabilized annual revenues under given programming assumptions; 2024 operations.
b) Based on information provided by NYAP in 2018 and 2019.
c) Fiscal impacts do not include PILOT contributions to the County and school district.

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